On 18 August the Commission issued Regulation Crypto Assets as a proposed rule.¹ The open meeting called to propose it had been cancelled five days earlier and was never rescheduled. I wrote about that cancellation earlier on 18 August, on the footing that no proposing release had been published. That changed within hours. This note sets out what the released text says and where it leaves the investor.
What the release fixes
The figures Chair Atkins had previewed now sit on the face of a release. A one-time exemption would permit offerings of up to $5 million during a four-year period. A second would permit offerings of up to $75 million during each 12-month period, with financial statements and ongoing reporting attached to the second and principles-based narrative disclosure required under both.² A conditional safe harbour would take a crypto asset outside the term “investment contract” in the Securities Act and Exchange Act definitions of “security” where its conditions are satisfied.² Issuers relying on the exemptions would remain subject to the antifraud and antimanipulation provisions of the federal securities laws.²
The release carries Release Nos. 33-11434 and 34-106150 and File No. S7-2026-27, under RIN 3235-AN38. The comment period runs for 60 days from publication in the Federal Register, which had not occurred when this was written.²
Subpart E
The caps have taken most of the coverage. Subpart E is the provision that changes the most. It would define “qualified purchaser” for the purposes of section 18(b)(3) of the Securities Act, with the effect that state securities law registration and qualification requirements would be pre-empted in respect of offers and sales of covered investment contracts issued under a Regulation Crypto Assets exemption, and in respect of certain secondary market transactions in those instruments.³
This is the mechanism introduced by the National Securities Markets Improvement Act of 1996 applied to a new class of instrument. Section 18(b)(3) operates on registration and qualification requirements. It does not by its terms displace state antifraud authority, and the proposal should be read on that footing rather than as a general withdrawal of state remedies.³
Where the remedy stops
The point I made about Section 11 survives the release and is sharpened by it. Section 11 of the Securities Act gives a person acquiring a security issued under a registration statement an express claim for a material misstatement or omission in that statement, without requiring proof of scienter.⁴ An exempt offering uses no registration statement, so Section 11 does not apply. Federal antifraud liability remains and requires proof of a different order.
Taken together, the proposal would pre-empt state registration and qualification requirements without supplying investors with a federal remedy equivalent to Section 11. That is a policy choice properly made through notice and comment, and the comment period is where it should be tested. Europe reached comparable ground by legislation. MiCA has applied in full since 30 December 2024 and founds civil liability for defective crypto-asset white paper content under Article 15, on conditions materially different from those of Section 11, though sitting in binding legislation that further legislation would be needed to change.⁵
What has not changed
The durability point stands. A framework built by rulemaking can be amended or rescinded by a later Commission, and any eventual rule would face a court applying its own judgment to disputed questions of statutory authority without Chevron deference. Commissioner Peirce is due to leave in November.⁶ The Digital Asset Market Clarity Act faces a cloture vote on the motion to proceed on 15 September.⁷ Issuing the release answers the question I asked on 18 August about timing. It does not answer the question underneath it, which is whether an administrative instrument can carry the weight Congress has not yet placed in a statute.
Notes
1. SEC, “SEC Proposes New Regulation Crypto Assets”, Press Release 2026-76, 18 August 2026. Regulation Crypto Assets, Release Nos. 33-11434 and 34-106150, File No. S7-2026-27, RIN 3235-AN38, SEC issue date 18 August 2026. The open meeting noticed for 14 August 2026 was cancelled on 13 August 2026 and was not rescheduled.
2. Regulation Crypto Assets, proposing release, summary and overview of proposed rules; Press Release 2026-76.
3. Regulation Crypto Assets, proposing release, Subpart E, defining “qualified purchaser” for the purposes of section 18(b)(3) of the Securities Act of 1933. The qualified purchaser category in section 18(b)(3) was introduced by the National Securities Markets Improvement Act of 1996. See also SEC, Defining the Term “Qualified Purchaser” Under the Securities Act of 1933, December 2001.
4. Securities Act of 1933, s.11, 15 U.S.C. s.77k.
5. Regulation (EU) 2023/1114 (MiCA), Article 15; applicable in full from 30 December 2024.
6. Bloomberg, 21 May 2026; Regent University School of Law announcement. Commissioner Peirce to join the faculty in November 2026.
7. Cloture filed on the motion to proceed to H.R. 3633, the Digital Asset Market Clarity Act, on 8 August 2026; vote scheduled for 15 September 2026.